Which of the following statements is false regarding regression analysis?
A) It is used to predict the fixed and variable components of a mixed cost.
B) It is used to predict whether a cost is a product or a period cost.
C) It is usually more accurate than the high/low method.
D) It uses statistical methods to fit a cost line through a number of data points.

Question

Quizplus · Accepted Answer

Regression analysis is not used to predict whether a cost is a product or a period cost; rather, it is used to predict the behavior of costs in relation to changes in volume or other factors.

Which of the Following Statements Is False Regarding Regression Analysis